The number of private jets in service in the United States has increased more than tenfold since 1970, from fewer than 1,000 then to more than 11,000 today. The number is projected to double again by 2025, according to industry forecasts, as manufacturers experience a modest increase in sales and deliveries starting next year followed by healthier gains predicted each year after — until the next major downturn, that is.
Until the mid-1990s, business aviation grew at roughly the same rate as the airlines. A rising tide of wealth in the United States in the decade preceding the 2008 financial crisis, however, set the stage for rapid growth among fractional ownership providers, charter companies and corporate flight departments. Between 2003 and 2007 alone, worldwide annual sales of private jets more than doubled to $19.4 billion.
Before the most recent downturn (there have been four since 1970), used airplanes often sold for more than the cost of a new one as buyers snapped up any airplane they could get their hands on and production lead times stretched to several years in some cases. Three years ago, that trend reversed completely, as a glut of pre-owned inventory hit the market and buyers canceled sales in droves. Most business jet makers remember the first few business aviation trade shows after the crisis as “cancellation bonanzas,” as would-be buyers approached the company booth with the bad news that they’d had their financing turned down or could no longer afford to make progress payments toward their purchase. As a result, “white tails” (airplanes that have already been built but which have no buyer) piled up on manufacturers’ ramps.
Today, the pre-owned inventory is shrinking and business jet manufacturers are reporting an increase in interest from cautious corporate tire kickers. Most expect firm orders to follow once the economy gets back on track. When that happens, of course, is the big unknown.
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